The Onel case: Benelux Office for Intellectual Property ruling on genuine use of a community trade mark

On 15 January 2010 the Benelux Office for Intellectual Property (“BOIP”) has rendered an important but controversial decision regarding the question whether use of a trade mark in one EU Member State could be considered genuine use of a Community Trade mark (“CTM”).

Pursuant to Article 15 of the CTM Regulation, a trade mark has to be put to genuine use in the Community within five years following the registration of such trade mark in order to remain valid. The European Court of Justice has not yet issued a decision on the question of how use in the Community should be understood and if use in one single Member State of the EU will suffice.

In opposition proceedings before the BOIP, Leno Merken B.V., owner of the CTM ONEL, opposed the application of the Benelux trade mark OMEL by Hagelkruis Beheer B.V.Opposing the OMEL trade mark application, Leno Merken was asked to provide evidence of genuine use of its earlier trade mark ONEL.

In the case at hand, both parties agreed that the CTM ONEL had been used in The Netherlands but differed about the question whether this use in one country was sufficient to meet the genuine use requirement.

The opponent argued that use in one single country is acceptable and based its arguments on the Joint Statements established by the European Commission and European Council in relation to the CTM Regulation. According to the opponent, providing proof of use in one country is precisely one of the system’s strengths. The defendant on the other hand argued that use in one country could not be sufficient to preserve the CTM since the CTM Regulation requires use “within the Community” which is quite different to “use in one Member State”.

The BOIP decided that the consideration in the Joint Statements relating to genuine use was not legally binding and at odds with the text and recitals of the CTM Regulation. The BOIP pointed out that aligning the territory of the Community with that of one single Member State could lead to undesirable and unreasonable results. The EU has grown to 27 Member States and further expansion is imminent. The BOIP decided that in view of this, use in only one country does not justify the broad protection provided by a CTM.

Concluding that the use in one country was insufficient to constitute genuine use, the opposition was rejected and the trade mark OMEL was allowed to be registered. The opponent has appealed the decision.

This decision is heavily criticised since it is seen by many as contradicting the unitary character of the CTM. In an official statement on its website the European Trade mark Office (OHIM) stated that “pending a possible appeal of this decision, OHIM – applying the principle of the unitary character of the CTM - continues to consider that boundaries of Member States should not play a part in assessing genuine use within the EU single market”.

However, in the absence of any ruling by the European Court of Justice, the decision might have a serious impact for trade marks owners in Europe. With this decision the validity of many Community Trade marks that are merely being used in one country in Europe would be at stake. Other national trade mark offices, such as the Hungarian Trade Mark Office, already followed the line of the BOIP.More guidance and clarification by the European Court of Justice is anxiously awaited.